Electric vehicle manufacturer Tesla has announced plans to build a “gigafactory” in Shanghai. The new facility will manufacture the company’s Megapack energy storage product, designed to store large amounts of electricity from renewable sources such as wind and sun. A single Megapack can power 3,600 homes for one hour, according to Tesla, and the batteries can store electricity to power factories or homes during peak times. The factory will initially produce 10,000 Megapack units per year, equal to about one eighth of Mexico’s annual electricity production.
Ground-breaking for the new factory is expected to take place in Q3 of this year, with production set to begin in Q2 of 2024. Tesla aims to reduce its costs and increase production of its Megapack lithium-ion battery units by using the Chinese battery supply chain. The Megapacks manufactured in Shanghai will be sold worldwide.
This new factory will complement Tesla’s existing plant in Shanghai for the assembly of electric vehicles, which delivered 710,000 vehicles last year. It will be located in the Lingang free trade zone near Shanghai. Despite tensions between the US and China, the US group is establishing another foothold in China at a time when the technology conflict between the USA and China is expanding. In addition, just a few weeks ago, Tesla boss Elon Musk announced the construction of another gigafactory in Mexico.